Fair and Balanced

http://www.rollingstone.com/politics/blogs/taibblog/austerity-cant-be-a-...

that is just a drop in the CDS bucket for them.. They probably have a lot more they are not revealing..

Sure the FED will never let them fail,, JPM and GS are the US government.. their banks..

The tax rate on long term capital gains and qualified dividends is determined by which tax bracket you are in.  If you are down in the 10% or 15% brackets (under 69,000 taxable income for married filing jointly), then the rate is 0%.   The highest rate is 15%.  However, the question of which bracket you are in is determined without the LT cap gains and qualified divs added in.

Here's an example:  Say Mr. Div Collector has 100,000 of long term cap gains and qualified dividends, and 20,000   everything else, for a total of 120,000 of income.  For bracket determination purposes, temporarily pull out those LT cap gains and divs.  He's got only 20,000 left.  Personal exemptions and itemized deductions will likely wipe that out to nothing.  He's in the 10% bracket, though there's nothing left of the "everything else" income to tax at 10%.  Now let's go back and tax the gains and dividends.  In the 10% bracket, the preferential tax on those items is 0%!  Bottom line is zero tax on the 100,000, and zero tax on the 20,000, for a total of....zero tax!

In order to generate these kind of investment results you'd have to be sitting on a pretty good sized portfolio.  Millions.  And if it works out right, you can pay zero, or damn close to zero, in tax.  It makes me want to puke. 

I'm not just dreaming this up.  I see real life examples of it on my desk every tax season.

Well, that has been quite the catch-up.

I will try to answer only #3 and #4, as all has been covered, and if you didn't already know what I thought (and I do tend to keep things to myself!), you can simply read Pining's post.  I have typed these words before, and I am sure I will type them again: Atlas IS shrugging and there will be no wealth to distribute.

As to civil, I would suggest that most of us can be (including me, when I remember what I am actually trying to do) but certain phrases jump out, like 'no-brainer', as suggesting otherwise. (See there I go, forgetting my better self already.) But it is important to distinguish between things that are actually opinion, and things that are as close to fact as we flawed humans can get through the use of logic and reason.  

But #4 - Gold is gold and paper is paper.  Get the real stuff when you can.  And when you doubt yourself, watch Charlie, Warren and Bill on CNBC and then remember that Charlie and Warren are selling gold coins with their own images on them.  If that doesn't do it, nothing will.  And if you look really closely at those coins, you will see the word HUBRIS engraved on their foreheads.  Shakespeare documents well what happens to people with too much hubris, and it is never pretty.  

Some how I keep thinking of the Ceausescus.  When I was a working lass I worked at a university press, and for some reason one of the subscriptions that came through the door was from Romania.   It was the greatest reading - each edition told a glowing story of the role of the elite in forming the great nation, and the role of the people in keeping it going.  And one knew it was a total lie.  And then one day I woke up and the revolution came - but it wasn't that they killed the leaders, it was that the first thing the people did was destroy all the files they could find.  I am ambivalent to the executions - but the internal media got more and more glowing and then boom - and the people destroyed all the information the government had collected.  You can not control what you cannot count.

And I think the JPM thing will be the excuse for the great printing to begin.  Remember after Lehman there was talk of a list of 50 banks/institutions that would be considered 'too big to fail' by the government - they talked about it openly.   JPM will  not be allowed to go down easily - they will try to save it.   Jamie Dimon as next treasury secretary was a brilliant call, btw.  We have often discussed a manufactured downturn in the stock-market to give the excuse to fire up the presses.  My guess is that Obummney will propose a programme to 'save' the housing market, in which the Fed, I mean government will buy up mortgages, to 'save' homeowners by driving up the price of houses.  People will see house prices recover, and bang, it will seem obvious the nation is on the right track, and with rising equity, more consumer debt.  The shopping spree can continue.  Just what I would do, and it really is true that the Fed does not let down a sitting president - Obama appoints Bernanke.  The bread knows where the butter comes from.

like just now it gets smacked down.. this is not normal trading!

Selling out to the Beast can be hazardous to shareholders and the business plan, quite possibly the Morgue is beginning to feel the heat. 30 years ago I recall a deal put together between a government entity and a private capital markets group whereby that in order to secure all of the future deals, the private group agreed to underwrite and finance all of the governmental units various bond deals regardless of whether or not they were found to be financially sound. They made millions working with this beast for several years.  This was the carrot used by government to entice the private financial group to play with them. After a time it was realized that many of the bonds issued were coming up short on making their scheduled bond interest payments and over a period of several years the government issuer's general fund had been exhausted and default began to occur and those millions of dollars invested into private debt securities to finance the government sponsored projects would be lost forever. 

Maybe Max had his life threatened, because it stopped after silver dropped big in may

A perfect example of simplistic thinking: "They have it, we need it, let's take it."

A complete misunderstanding of the problem: "Higher taxes are the solution".

A total ignorance of economics: "The government NEEDS to be this big to support the people".

Fear mongering: "If we cut government we'll lose all the gains we've made".

Bullship.

This problem requires some adherence to the reality,

#1 We have to employ Americans. Until the cost of employing Americans is reduced, the jobs won't come back home. Without jobs there is no way out, the system will collapse.

#2 You can't continually drain the profit out of investing in American (capital gains) and expect American business to flourish. The money will go elsewhere, as it should.

#3 You can't expect higher taxes to support an entire class of people that don't support themselves. There isn't enough money there, do the math.

#4 You can't remove the profit motive for hard work and innovation. Because hard work and innovation go somewhere it can find reward. Americans will be the big losers.

#5 Bad government caused this problem. Rewarding the payola for votes system must end.

This video completely misdirects the problem onto the backs of the people who are currently propping up the system, by targeting the 'givers' and favoring the "takers". She uses an easy target, the "rich" to rally an oppressive attitude of neediness.

It's easy to do this now because our government has failed to correct the problems in the financial system, providing a 'simple' target for those don't understand the system. This allows a solution to be painted with a very broad, inappropriate, and dangerous brush.

It is our government that failed to correct the current problems in the financial system. Don't forget, those crooks can't get away with their crimes unless the government fails to do their job. And the government failed to do their job because they felt it was in their own best interest.

As an "overworked" government employee, she allows herself a street cred that she doesn't deserve, she obviously can't do the math, and obviously doesn't understand economics.

It may be counter intuitive to those who don't understand economics, but lifting the burden off the shoulders of those who make the jobs is the only way out. Without the jobs, there is no answer.

I don't have to go to work now, because I own my own business. But I am going anyway because I want my business to be successful. When the profit motive is reduced to the level that I can't be successful, I'll stop going to work. I won't create new products or new ventures or employ new people. I'll retire.

When you can take the profit motive away from me, in an effort to support others, I'll quit, naturally.

I work to support my dream, not yours.

absolutely

OK, I am not a professional investor and have only a rudimentary understanding of Credit Default Swaps. Zerohedge breaks this little story this morning and I am left scratching my head.

The one print everyone is looking for this morning:

• IG9 10Y 135/137.5...  +9.5bps

Assuming ~$200MM DV01 and.... oh boy.

It would appear the hedge fund community has found a weakness...

Can someone here explain the significance to me (and the rest of us)?  What does this mean for JPM and for the US financial markets?  I did find a helpful link in the comment section of that ZH article: http://lcdx.wikidot.com/ig9-summary

Actually, when I see Zerohedge writers and fight club comments NOT dumbing down their material for regular guys like me, it enhances their credibility in my view. Each time I have been serious abut understanding a particular issue and have dug in, I was not disappointed and found that the ZH crowd really does get what is happening on wall street and why this world economy is in so much trouble.

Just as I suspected, more downside coming in the metals. Nibble here if you are stacking, but be aware of further downside potential. Realistically silver could trade down as low as $26 in relatively short order.

You would think that JPM posting billions in losses would be a clue to the masses that the system is broken--bullish for the metals. But as we suspected, the markets work in opposite fashion and the metals are being pillaged again.

I'm still not a buyer here.

OIL: I'm transferring dry powder into my trading account, if oil drops more the profit/loss ratio would be too good to pass up. What that number is, I have no clue, 90,92,93 whatever, what do you think it will be several months from now? It'll be back in the 100's soon enough.

When things were going up, everybody was outdoing the other guy with higher projections.  They turned out to be bullshit.   Now when things are going down, everybody is outdoing the other guy with lower projections.  They'll turn out to be bullshit too.

Here's how it will play out.  Some wise guys were too smart to buy silver at 32, saying they'll wait until 29.  When we got 29, they say not yet, I'll wait for 27.   If we hit 27, they'll say no not yet, I'm so smart I'll wait for 25.

Then we'll get a rip your face off rally back to 30, but they won't buy because they had their heart set on 25-27, and they'll wait for it.  When we see 33 they'll finally throw in the towel and start to buy.  They'll be buying north of 33, when they were too smart to buy at 32 in the first place.  Or even at 29.  

@ Xty - You have earned a smile and Hat Tip for that!

@ Big Buffalo - I agree that this is a good conversation thread.

Unfortunately, this circle of friends is not one that also overlaps into my "real world" existence, largely because my real world friends started to think I was nuts.

There was a time when I did try using places like Facebook to enlighten others on what's been going on in the world, but I actually started receiving messages  asking if my page had been hacked by some crazy guy. I've since learned to focus my FB posts to safe discussions such as sports, or witty commentary on all things Kim Kardashian. Funny pet pictures seem to go over well too.

There are, however, a few friends and family who have politely listened over the years, and as a few "predictions" have now accurately come to pass I think they too are slowly starting to wake up.

More than a few people have actually been rattled to watch me really "go Galt", including my move to the boonies last year.